It's when you put a track cog onto a hub made for a freewheel. Since there is no lockring, if you back pedal, the cog could unscrew which would mean zero braking power.

There are ways to jerry rig a lockring on a hub like this that are not too bad. But I wouldn't recommend riding a bike set up like this without at least one handbrake regardless. Other than the backpedalling issue, there's nothing inherently dangerous about it.